The Economic Downturn..

[Tripe]

The other thing I don't understand is why the STOCK market would tank as a result of a downgrade in United States government BOND ratings.

Because the stock market is full of some of the most panicky children in the financial world. You want a steady and prolonged stock market trend, get them all blown at the beginning of the day and promise them an ice cream social/pizza party at the end of it. well probably see record highs.

I'm only slightly exaggerating there, the stock market doesn't have trends so much as tantrums

[Thrifty]

The other thing I don't understand is why the STOCK market would tank as a result of a downgrade in United States government BOND ratings.

Because the stock market is full of some of the most panicky children in the financial world. You want a steady and prolonged stock market trend, get them all blown at the beginning of the day and promise them an ice cream social/pizza party at the end of it. well probably see record highs.

I'm only slightly exaggerating there, the stock market doesn't have trends so much as tantrums

Sounds like Congress. 

[RVR II]

Stock Market Lost -634.76 FUCK!!

[Danecho1967]

The other thing I don't understand is why the STOCK market would tank as a result of a downgrade in United States government BOND ratings.

Because the stock market is full of some of the most panicky children in the financial world. You want a steady and prolonged stock market trend, get them all blown at the beginning of the day and promise them an ice cream social/pizza party at the end of it. well probably see record highs.
I'm only slightly exaggerating there, the stock market doesn't have trends so much as tantrums

I really agree with that.  I've never been tempted to get into the stock market, because investers tend to overreact and a lot of people lose money.

Just a curiosity question: do you think the additional downgrades to Fanny Mae, Freddy Mac and several banks are part of the reason the drop was so large?

[RVR II]

Just a curiosity question: do you think the additional downgrades to Fanny Mae, Freddy Mac and several banks are part of the reason the drop was so large?

Probably a good part of it..
It's 'uncharted territory' which sends people into panic mode

[k1]

Can't wait to see the next Quarterly report on my retirement funds!    The crappy thing is that this would be the ideal time to be throwing money at stuff while it's cheap.  And unfortunately I can't because of the whole "need a job that pays for more than just daycare" thing.

[Thrifty]

Does anyone remember the last time we had a great economy, back in the late 90s with the dot-com boom?  Then that bubble burst and we had a recession from like 2001-2003.  Seems like that one wasn't as bad, and didn't get as much press.  Then we came out of that with the housing bubble, and when it burst we ended up in the mess we're in today.

I'm starting to come around to this school of thought that the governments of the world can control the economy about as well as they can control the weather.  I have this pessimistic view that any growth faster than the sluggish growth we're seeing is only gonna pave way for the NEXT bubble and resulting recession.

[Bob]

It all runs in cycles, it has for hundreds of years.   This is no difference, despite the historic over reactions.

[RVR II]

It all runs in cycles, it has for hundreds of years.   This is no difference, despite the historic over reactions.

Yeah the Romans foresaw their doom.. Just like the Greeks see theirs now

[Artie]

After helping with the last economic collapse (by giving AAA ratings to mortgage backed securities that turned out to be worthless) they must have decided they wanted be in (or even start) the next one.

Think they're enjoying the chaos they're creating right now? 

[Thrifty]

Yesterday, as the Dow fell hard in response to the S&P ratings downgrade, I read one economical prognosticator saying "The markets have a long way to go before it hits bottom."

Dow closed up 430 points today.  It's about 200 below the closing bell on Friday.

Something tells me that economic forecasting isn't an exact science.

[RVR II]

Something tells me that economic forecasting isn't an exact science.

It resembles Newton's 3rd Law quite nicely here..

[Doctor Who?]

Okay so the Dow seems to be losing between 300 and 600 points a day right now and I have a question.  The Dow seems to be worth between 10,000 and 11,000 point so what happens if this keeps up for 37 days and it reaches zero?

[Thrifty]

Okay so the Dow seems to be losing between 300 and 600 points a day right now and I have a question.  The Dow seems to be worth between 10,000 and 11,000 point so what happens if this keeps up for a long time and it reaches zero?

It'd probably be a lot like The Running Man, in which all the world's economies collapse and we fall to a dystopian world.

Really it can't reach 0.

The Dow Jones Industrial average does not actually measure the performance of every stock on the market.  It's actually based on the trading activity of 30 publicly traded companies:

3M
Alcoa
American Express
AT&T
Bank of America
Boeing
Caterpillar
Chevron
Cisco
Coca Cola
Dupont
Exxon-Mobil
General Electric
Hewlett Packard
The Home Depot
Intel
IBM
Johnson & Johnson
Kraft Foods
McDonald's
Merck
Microsoft
Pfizer
Procter & Gamble
Travelers
United Technologies
Verizon
Walmart
Walt Disney

Therefore, for the DJIA to reach 0, all 30 of these companies would have to see their stock prices drop to zero.

[Doctor Who?]

Okay so the Dow seems to be losing between 300 and 600 points a day right now and I have a question.  The Dow seems to be worth between 10,000 and 11,000 point so what happens if this keeps up for a long time and it reaches zero?

It'd probably be a lot like The Running Man, in which all the world's economies collapse and we fall to a dystopian world.

Really it can't reach 0.

The Dow Jones Industrial average does not actually measure the performance of every stock on the market.  It's actually based on the trading activity of 30 publicly traded companies:

3M
Alcoa
American Express
AT&T
Bank of America
Boeing
Caterpillar
Chevron
Cisco
Coca Cola
Dupont
Exxon-Mobil
General Electric
Hewlett Packard
The Home Depot
Intel
IBM
Johnson & Johnson
Kraft Foods
McDonald's
Merck
Microsoft
Pfizer
Procter & Gamble
Travelers
United Technologies
Verizon
Walmart
Walt Disney

Therefore, for the DJIA to reach 0, all 30 of these companies would have to see their stock prices drop to zero.

Okay,thanks for the information.